Copper breaking higher. Further gains in the coming weeks

High Grade Copper has broken above critical resistance at the USD2.7400 year high of November 2016.

Further gains are highlighted in the coming weeks, as momentum studies tick higher and sentiment improves, with a break above the USD2.7670 high of June 2015 targeting historic congestion around USD2.8000.

Still higher are the USD2.8345 high of 26 May 2015 and the USD2.8555, (61.8%) Fibonacci retracement of the 2014-2016 fall. However, initial tests of this area could give way to consolidation, as momentum becomes overstretched, before a clear break is seen.

Support remains at congestion around USD2.6000, and should underpin any immediate setbacks as investors maintain a buy-into-weakness strategy. If broken, not seen, focus will turn back to congestion around USD2.5500, as investors subsequently move back to a cautious stance.